I really think we should acknowledge the market cap commonly seen when biotech's have drugs with good news and are presumed to be approaching approval. Most that I'm familiar with range from half a billion to a few billion dollars. Depending on the O/S if it's truly near a billion shares as the price rises and warrants etc are converted to stock, essentially the market cap and dollar share price are the same.
When people speak about price ranging from $5 to $20 or more, it certainly can happen, but it will require either a partnership, or earnings approaching $1 billion annually. I.E. what I'm suggesting is that without a partnership or buyout, we'll need approval and moderate sales to reach high single digit or double digit dollar figures.
That said, if the clinical news is great and the share price does go to double digits, each of us have choices. I've never been a major trader, but at double, or near double digit share prices I'd be putting in some stop loss orders if I didn't sell out. If I did sell, and if the market cap came back down to a few billion or less, I would very probably be back in bigger than ever. You never know what emotion will do for a stock, if people who've never previously heard of NWBO read an article indicating great results in the DCVax-L Trial, even if the market cap is $2 billion, if it's $2, it still sounds cheap, it will still sound cheap to others at $5, and still others at $10, so no telling how high it may go on emotion. When reality hits and the new investors realize that it will be awhile before earnings justify the current price, some correction should certainly be expected. Practitioners of T/A would probably expect the stock to retrench to 50% of the gain, if it starts at where it is today, that would be half the price. If you do sell at or near the high, you'll probably be able to repurchase your shares for half of what you sold them for, but perhaps even substantially less. .
As most here probably know, I've been invested in IMGN for decades. It currently has completely monetized the one drug that was approved that utilized its technology, and when it failed to meet Phase 3 goals an additional Phase 3 is required, I suspect it will be 2022 before it has another approved drug. Currently it's market cap is $.5 billion. SGEN which clinically has had essentially no more success than IMGN, but who still owns a major position in its one approved drug has a market cap of $20 billion, 40 times that of IMGN. In spite of the fact that SGEN is yet to be profitable, it does have earnings and that has it's price at a huge multiple of IMGN's. I certainly made the wrong choice decades ago when I didn't buy SGEN, and ever since I've felt it overpriced when compared with IMGN. Hopefully NWBO will be much more like SGEN.
Gary
